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CASE NO.:

Appeal (civil) 2534 of 2007

PETITIONER:

Management, Pandiyan Roadways Corp. Ltd.

RESPONDENT:

N. Balakrishnan

DATE OF JUDGMENT: 15/05/2007

BENCH:

S.B. Sinha & Markandey Katju

JUDGMENT:

J U D G M E N T

CIVIL APPEAL NO. 2534 OF 2007

[Arising out of S.L.P. (Civil) No. 12280 of 2006]

S.B. SINHA, J :

1. Leave granted.

2. Respondent herein was employed as a helper at Kumuli Depot of

Appellant. A criminal complaint was lodged against him for alleged

commission of theft of Rs.37,086.05 on 03.11.1985. A disciplinary

proceeding was also initiated against him. He pleaded not guilty to the said

charge both before the disciplinary authority as also the criminal court. In

the disciplinary proceeding, he was, however, found to be guilty of the said

charge. He was dismissed from services only after a show cause notice

was served on him.

3. Appellant filed an application for approval of the said order of

removal purported to be in terms of Section 33(2)(b) of the Industrial

Disputes Act, 1947 (for short, 'the Act'). Approval sought for was not

granted on the premise that in passing the said order of termination, Clause

17(5) of the Certified Standing Orders of the Corporation, which required

the management to take into account the past record before passing the order

of dismissal, was not complied with.

4. During pendency of the said proceedings before the Tribunal,

admittedly the Criminal Court held the respondent not guilty of commission

of the charge of removal of the said amount of Rs. 37,086.05. He was,

therefore, acquitted.

5. A Writ Petition was filed by the appellant questioning the said Order

of the Labour Court which was marked as Writ Petition No. 1485/1990. A

learned Single Judge of the said Court allowed the Writ Petition. Aggrieved

by and dissatisfied therewith, Respondent preferred an appeal before a

Division Bench of the High Court. By reason of the impugned judgment,

the said appeal has been allowed holding :

"14. Unfortunately, the learned Judge while

accepting the case of Management, committed two

errors. The first one is that he proceeded that the

charge leveled against the workman relates to

misappropriation. It is not in dispute that based on

the complaint of the Management, prosecution was

launched against the workmen for the offence of theft,

which also ended in acquittal in C.C. No. 75 of 1986

on the file of Judicial Magistrate, Uthamapalyam

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dated 14.10.1987. Secondly, the learned Judge

committed an error in holding that when an employee

is involved in the case of misappropriation of funds,

no lesser punishment than the dismissal from service

can be imposed. However, according to the learned

Judge when a major punishment is to be imposed

depending upon the nature or gravity of the offence,

then the factors mentioned in clause 17(5) of the

Standing Orders have some relevance."

6. Appellant is, thus, before us.

7. Mr. T. Harish Kumar, learned counsel appearing on behalf of the

appellant, would submit that Clause 17(5) of the Certified Standing Orders

of the Corporation cannot be held to be imperative in character. According

to the learned counsel, in a case of misconduct involving criminal breach of

trust, the employer would be justified in imposing a punishment of

termination of services and in that view of the matter, question of looking

into the past conduct of the employee would not arise.

8. It was contended that past conduct of an employee would be taken

into consideration, only in the event the misconduct proved is not a grave

one. In a matter involving commission of grave misconduct on the part of

the workman, it was contended, there is no place for generosity or sympathy

and the case has to be dealt with firmly. Reliance, in this behalf, has been

placed on Janatha Bazar (South Kanara Central Cooperative Wholesale

Stores Ltd.) and Others v. Secretary, Sahakari Naukarara Sangha and Others

(2000) 7 SCC 517] and Divisional Controller, KSRTC (NWKRTC) v.

A.T. Mane [(2005) 3 SCC 254].

9. The learned counsel argued that it was not a case where the High

Court could have taken into consideration the question as to whether the

punishment imposed was shockingly disproportionate to the misconduct

proved. It was urged that the jurisdiction of the Labour Court in considering

the petition under Section 33(2)(b) Act being limited; it could not reappraise

the evidence adduced in the disciplinary proceeding. Even acquittal in a

criminal proceeding Mr. Harish Kumar submitted, could not have any effect

in a domestic enquiry, in view of the fact that the standard of proof in

criminal proceeding and domestic enquiry is entirely different. Strong

reliance, in this behalf, has been placed on South Bengal State Transport

Corporation v. Sapan Kumar Mitra and Others [(2006) 2 SCC 584] and N.

Selvaraj v. Kumbakonam City Union Bank Ltd. and Another [(2006) 9 SCC

172].

10. Mr. S. Guru Krishna Kumar, learned counsel appearing on behalf of

the respondent, on the other hand, would submit that it is not a case where

this Court should exercise its discretionary jurisdiction under Article 136 of

the Constitution of India. It was contended that clause 17(5) of the Certified

Standing Orders was clearly applicable and the conditions laid down therein

must be considered before imposition of punishment keeping in view its

cumulative effect. The learned counsel would contend that clause 17(5) of

the Certified Standing Orders is mandatory in character. It was also

contended that admittedly past conduct of the respondent has not been

considered while imposing the punishment. It was urged that the conduct

of the respondent was otherwise blemishless otherwise. Our attention, in

this behalf, has been drawn to the fact that in terms of the order of the

Labour Court refusing to grant approval, the respondent was taken back in

service in the year 1989 and since then he has been working in the bank

without any blemish whatsoever. The learned counsel would submit that the

order of acquittal passed by the Criminal Court having been taken into

consideration by the Division Bench, the same should be considered to be an

additional factor apart from the factors contained in Clause 17(5) of the

Certified Standing Orders.

11. Clause 17(5) of the Standing Orders of the Corporation reads as

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under :

"In awarding the punishment under this standing order

the employer shall take into account the gravity of the

misconduct, the previous record of the workman and

any other extenuation or aggravating circumstances that

may exist."

12. On a plain reading of the said provision and particularly in view of the

fact that the word "shall" has been used, prima facie it would be construed

to be imperative in character. It may, however, be held to be directory in

certain situation. While construing a statute of this nature, the context plays

an important role. Interpretation of a statute would also depend upon the

fact situation obtaining in the case. There are, however, certain exceptions

to the said rule. The question came up for consideration before this Court in

U.P. State Electricity Board v. Shiv Mohan Singh and Another [(2004) 8

SCC 402] wherein it was, inter-alia, noticed :

"96. Ordinarily, although the word shall is considered to

be imperative in nature but it has to be interpreted as

directory if the context or the intention otherwise

demands. (See Sainik Motors v. State of Rajasthan, AIR

para )

97. It is important to note that in Crawford on Statutory

Construction at p. 539, it is stated:

271. Miscellaneous implied exceptions from the

requirements of mandatory statutes, in

general.Even where a statute is clearly mandatory

or prohibitory, yet, in many instances, the courts

will regard certain conduct beyond the prohibition

of the statute through the use of various devices or

principles. Most, if not all of these devices find

their justification in considerations of justice. It is

a well-known fact that often to enforce the law to

its letter produces manifest injustice, for frequently

equitable and humane considerations, and other

considerations of a closely related nature, would

seem to be of a sufficient calibre to excuse or

justify a technical violation of the law.

\005 \005 \005

105. Only because the expression shall has been

employed in sub-section (4) of Section 4, the same may

not be held to be imperative in character having regard to

the fact that not only, as noticed hereinbefore, a contract

of apprenticeship commences but also in view of the fact

that an application for registration of apprenticeship

contract is required to be made within a period of three

months in terms of Rule 4-B of the Apprenticeship Rules,

1992. The Act nowhere provides for the consequences of

non-registration.

\005 \005 \005

109. It is now a well-settled principle of law that if the

language used in a statute is capable of bearing more than

one construction, the true meaning thereof should be

selected having regard to the consequences resulting

from adopting the alternative constructions. A

construction resulting in hardship, non-fulfilment of the

purpose for which the statute has been brought in force

should be rejected and should be given that construction

which avoids such results."

13. Yet again in P.T. Rajan v. T.P.M. Sahir and Others [(2003) 8 SCC

498], this Court observed :

"45. A statute as is well known must be read in the text

and context thereof. Whether a statute is directory or

mandatory would not be dependent on the user of the

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words shall or may. Such a question must be posed and

answered having regard to the purpose and object it seeks

to achieve.

46. What is mandatory is the requirement of sub-section

(3) of Section 23 of the 1950 Act and not the ministerial

action of actual publication of Form 16.

47. The construction of a statute will depend on the

purport and object for which the same had been used. In

the instant case the 1960 Rules do not fix any time for

publication of the electoral rolls. On the other hand

Section 23(3) of the 1950 Act categorically mandates that

direction can be issued for revision in the electoral roll by

way of amendment in inclusion and deletion from the

electoral roll till the date specified for filing nomination.

The electoral roll as revised by reason of such directions

can therefore be amended only thereafter. On the basis of

direction issued by the competent authority in relation to

an application filed for inclusion of a voters name, a

nomination can be filed. The person concerned,

therefore, would not be inconvenienced or in any way be

prejudiced only because the revised electoral roll in Form

16 is published a few hours later. The result of filing of

such nomination would become known to the parties

concerned also after 3.00 p.m.

48. Furthermore, even if the statute specifies a time for

publication of the electoral roll, the same by itself could

not have been held to be mandatory. Such a provision

would be directory in nature. It is a well-settled principle

of law that where a statutory functionary is asked to

perform a statutory duty within the time prescribed

therefor, the same would be directory and not mandatory.

(See Shiveshwar Prasad Sinha v. District Magistrate of

Monghyr, Nomita Chowdhury v. State of W.B. and

Garbari Union Coop. Agricultural Credit Society Ltd. v.

Swapan Kumar Jana)

49. Furthermore, a provision in a statute which is

procedural in nature although employs the word shall

may not be held to be mandatory if thereby no prejudice

is caused. (See Raza Buland Sugar Co. Ltd. v. Municipal

Board, Rampur, State Bank of Patiala v. S.K. Sharma,

Venkataswamappa v. Special Dy. Commr. (Revenue) and

Rai Vimal Krishna v. State of Bihar.)"

14. In Ashok Lanka and Another v. Rishi Dixit and Others [(2005) 5 SCC

598], it was held :

"53. The question as to whether a statute is mandatory or

directory would depend upon the statutory scheme. It is

now well known that use of the expression shall or may

by itself is not decisive. The court while construing a

statute must consider all relevant factors including the

purpose and object the statute seeks to achieve. (See P.T.

Rajan v. T.P.M. Sahir and U.P. SEB v. Shiv Mohan

Singh.)"

15. There cannot also be any doubt that ordinarily consequences flowing

from contravention of an imperative character of a statute has to be given

effect to. A statutory provision may be substantive or procedural. If it is

substantive, the requirements laid down in the statute should ordinarily be

complied with. However, when the provisions contain a procedural matter,

substantial compliance thereof would serve the purpose.

16. Application of a statute or principle of law, however, may vary from

case to case.

17. Only because the statute is imperative, it may not necessarily lead to a

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declaration that the order impugned is a nullity.

18. In State Bank of Patiala and Others v. S.K. Sharma [(1996) 3 SCC

364], this Court has, inter alia, laid down the law in the following terms :

"33. We may summarise the principles emerging from

the above discussion. (These are by no means intended to

be exhaustive and are evolved keeping in view the

context of disciplinary enquiries and orders of

punishment imposed by an employer upon the

employee):

\005 \005 \005

(4)(a) In the case of a procedural provision which

is not of a mandatory character, the complaint of

violation has to be examined from the standpoint

of substantial compliance. Be that as it may, the

order passed in violation of such a provision can

be set aside only where such violation has

occasioned prejudice to the delinquent employee.

(b) In the case of violation of a procedural

provision, which is of a mandatory character, it has

to be ascertained whether the provision is

conceived in the interest of the person proceeded

against or in public interest. If it is found to be the

former, then it must be seen whether the

delinquent officer has waived the said requirement,

either expressly or by his conduct. If he is found to

have waived it, then the order of punishment

cannot be set aside on the ground of the said

violation. If, on the other hand, it is found that the

delinquent officer/employee has not waived it or

that the provision could not be waived by him,

then the Court or Tribunal should make

appropriate directions (include the setting aside of

the order of punishment), keeping in mind the

approach adopted by the Constitution Bench in B.

Karunakar18. The ultimate test is always the

same, viz., test of prejudice or the test of fair

hearing, as it may be called."

19. Ordinarily, although sub-clause (5) of Clause (17) of the Certified

Standing Orders is required to be complied with, the same, in our opinion,

would not mean that in a given situation, there cannot be any deviation

therefrom. In a case where dismissal or removal of service is to be

ordinarily followed, e.g. in a case of grave misconduct like

misappropriation, strict enforcement of the rule may not be insisted upon.

When, we say so, we are not oblivious of the law that an executive agency is

ordinarily bound by the standard by which it professes its actions to be

judged. [See Harjit Singh & Another v. The State of Punjab & Another

[2007) (3) SCALE 553]. But where a procedural provision merely embodied

the principles of natural justice, in view of the decision of this Court in State

Bank of Patiala (supra), the question as to whether the principle has been

followed or not, will depend upon the fact situation obtaining in each case.

[See Ashok Kumar Sonkar v. Union of India & Others \026 [2007 (3) SCALE

517].

20. It will be useful to note that in State of Punjab and Others v.

Sukhwinder Singh [(1999) SCC (L&S) 1234], this Court has held that the

words "gravest act of misconduct" occurring in Rule 16.2(1) of the Punjab

Police Rules need not be used in the order of punishment, as it can be found

out from the factual matrix obtaining in each case.

21. However, there is another aspect of the matter which cannot be lost

sight of. Respondent, in the meanwhile, has been acquitted. The factum of

his acquittal has been taken into consideration by the Division Bench, which

was considered to be an additional factor. Ordinarily, the question as to

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whether acquittal in a criminal case will be conclusive in regard to the order

of punishment imposed upon the delinquent officer in a departmental

proceeding is a matter which will again depend upon the fact situation

involved in a given case.

22. There are evidently two lines of decisions of this Court operating in

the field. One being the cases which would come within the purview of

Capt. Paul Anthony v. Bharat Gold Mines Ltd. and Another [(1999) 3 SCC

679] and G.M. Tank v. State of Gujarat and Others [(2006) 5 SCC 446].

However, the second line of decisions show that an honourable acquittal in

the criminal case itself may not be held to be determinative in respect of

order of punishment meted out to the delinquent officer, inter alia, when :

(i) the order of acquittal has not been passed on the same set of fact or same

set of evidence; (ii) the effect of difference in the standard of proof in a

criminal trial and disciplinary proceeding has not been considered. [See

Commissioner of Police, New Delhi v. Narender Singh (2006) 4 SCC 265],

or; where the delinquent officer was charged with something more than the

subject-matter of the criminal case and/or covered by a decision of the Civil

Court. [See G.M. Tank (supra), Jasbir Singh v. Punjab & Sind Bank and

Others - 2006 (11) SCALE 204, and Noida Enterprises Assn. v. Noida &

Others - 2007 (2) SCALE 131 \026 Para 18]

23. In Narinder Mohan Arya v. United India Insurance Co. Ltd. and

Others [(2006) 4 SCC 713], this Court held :

"39. Under certain circumstances, a decision of a civil

court is also binding upon the criminal court although,

converse is not true. (See Karam Chand Ganga Prasad

v. Union of India). However, it is also true that the

standard of proof in a criminal case and civil case is

different.

40. We may notice that in Capt. M. Paul Anthony v.

Bharat Gold Mines Ltd., this Court observed: (SCC p.

695, para 35)

"35. Since the facts and the evidence in

both the proceedings, namely, the departmental

proceedings and the criminal case wee the same

without there being any iota of difference, the

distinction, which is usually drawn as between the

departmental proceedings and the criminal case on

the basis of approach and burden of proof, would

not be applicable to the instance case."

41. We may not be understood to have laid down a law

that in all such circumstances the decision of the civil

court or the criminal court would be binding on the

disciplinary authorities as this Court in large number of

decisions points out that the same would depend upon

other factors as well. See e.g. Krishnakali Tea Estate v.

Akhil Bharatiya Chah Mazdoor Sangh and Manager,

Reserve bank of India v. S. Mani. Each case is,

therefore, required to be considered on its own facts.

24. In Delhi Cloth and General Mills Co. v. Ganesh Dutt and Others

[(1972) 4 SCC 834], this Court stated :

"31. Mr. Sharma referred us to Paragraph 40 of the

Certified Standing Orders of the appellant Company Ex.

M-4 to the effect that in the order deciding to dismiss the

workman, the appellant Company has not taken into

account, as it is bound to, the previous record, if any, of

the workmen. This contention cannot be accepted

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because in the order dated May 9, 1966, communicated

to each of the workmen, in the penultimate paragraph it

has been stated that while arriving at the decision to

dismiss the employees from the service for misconduct,

all relevant circumstances including the past record of

service, have been fully taken into consideration. So far

as we could see, no challenge has been made by the

workmen that the appellant has not taken into account his

past record."

25. We are, however, of the opinion that it is not a fit case where this

Court should exercise its extra extra-ordinary jurisdiction under Article 136

of the Constitution of India. Respondent has been taken back in service in

the year 1989. The occurrence took place in the year 1985. The

application under Section 33(2)(b) of the Act was filed on 16.06.1986. It

was rejected by an order dated 19.4.1989. Respondent, thereafter, was taken

back in service. Despite the fact that the Writ Petition filed by the appellant

was allowed on 08.10.1999, by reason of an interim order of stay granted by

the Division Bench, he continued in his service. By reason of the impugned

judgment, the Division Bench, as noticed hereinbefore, set aside the

judgment of the learned Single Judge. Respondent is merely a class IV

employee, it does not hold any office of confidence. He was not charged

with an offence of criminal breach of trust.

26. Thus, it is now well-settled principle of law that this Court shall not

exercise its jurisdiction under Article 136 of the Constitution of India, only

because it may be lawful to do so. [See Transmission Corporation of A.P.

Ltd. v. Lanco Kondapalli Power (P) Ltd. (2006) 5 SCC 540] and Chandra

Singh and Others v. State of Rajasthan and Another [(2003) 6 SCC 545].

27. For the reasons aforementioned, the appeal is dismissed. However, in

the facts and circumstances of the case, there shall be no order as to costs.